Gold Price News and Analysis
– Gold stuck on the down trend as political jitters calm.
– Friday’s US data calendar, including non-farm payrolls, may spark a move.
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The latest IG Retail Sentiment Indicatorshows that traders are 79.4% net-long of the precious metal, yet recent positional changes give a mixed trading bias.
Gold Price Mired Around $1,300/oz
The precious metal is currently trading either side of the down channel from the April 11 high and is unable to decide whether to respect the channel or reject it. With the political situation in Italy calming down for now and with US Treasury yields edging back higher, gold should look to sell the channel and move lower as safe-haven buyers take a back seat. The down channel also intersects the 50% Fibonacci retracement level at $1,301/oz. and this again can be taken as either resistance or possible support for a move higher. A move to the upside would also encounter resistance from the 200-day moving average at $1,308.5/oz.
A break-out from this area will need a catalyst and Friday’s non-farm payrolls, unemployment and wages data may well produce this. The current market expectation of 190k new jobs is priced-in, and will need a sizeable miss either way to move the market, so the unemployment and wage data becomes even more relevant. Today’s initial jobless claims came in lower than expected at 221k – expectations 228k and a prior 234k – while the Chicago MNI Business Barometer jumped to a four-month high of 62.7, beating expectations of 58.3 and a prior reading of 57.6. US continuing claims also fell earlier.
A potentially tighter jobs market may push wages higher, forcing US Treasury yields back towards recent highs and putting downward pressure on gold.
Gold Spot Price Chart Daily Time Frame (August 10, 2017 – May 31, 2018)
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— Written by Nick Cawley, Analyst